Definitions - Commonly Used Terms and Acronyms

An accessory dwelling unit (ADU) is a second dwelling unit created on a lot with a house, attached house or manufactured home. The second unit is created auxiliary to, and is smaller than, the main dwelling. ADUs can be created in a variety of ways, including conversion of a portion of an existing house, addition to an existing house, conversion of an existing garage or the construction of an entirely new building.

Acq

Acquisition

Acquisition

The cost of purchasing the land or land and buildings to be developed.

Acquisition/Rehab

A project where the purchase of land and buildings and construction rehabilitation of the property are both included in the loan request. Affordable Housing: housing affordable to persons or families whose income is at or below 60 percent of MFI. (Housing affordability is imputed at thirty percent or less of gross income at 60 percent MFI).

Affordability / Affordable

Describes the relationship between household income, housing costs and established standard of affordability. The standard for "Affordable" means the following:

For rental housing: the agency utilizes the HUD affordability standard, which states that the rent plus expenses associated with occupancy, such as tenant paid utilities or fees, does not exceed 30% of the gross household income, based on unit size, at the level of the rent restriction.

For homeownership units: the purchase price, for which the sum of debt service and housing expenses (including an allowance for utilities and other required ownership fees), when compared to the annual gross income for a family, adjusted for family size, does not preclude conventional mortgage financing.

After Value

The property's market value based on the probable condition of the property after completion of the proposed rehabilitation or construction as determined by a certified fee appraiser or Prosper Portland staff.

Agr

Agricultural

Allowed Expenses

The sum of the following: (A) Operating Expenses, (B) all deposits to cash reserves established and funded for payment of anticipated or contingent partnership expenses that must be paid pursuant to a loan agreement to which the Project Sponsor is a party, plus (C) payments pursuant to the Preferred Developer Promissory Notes for deferred developer fees, to the extent the total capitalized fee and deferred fee do not exceed the agency's Maximum Allowable Developer Fee, less equity requirements not funded through other contributions.

AMI

Area Median Income

Anchor Institutions

Large organizations, most often public or nonprofit, that are primarily anchored in place—colleges and universities, hospitals and health-care facilities, utilities, faith-based organizations, museums, and arts centers. Anchor institutions are key drivers of local and regional economic opportunity. Anchor institutions offer stable
jobs, many with career ladders and good wages and benefits, and strong purchasing power of goods and services.

APNBA

Alliance of Portland Neighborhood Assoc.

As Is Value

The property's current market value as determined by a certified fee appraiser or the most recent assessed value by the County Assessor as verified or modified by Prosper Portland staff.

Asst

Assistance

AW

Airport Way

B

Beav

Beaverton

BES

Brown Field Regulations, Bureau of Environmental Services

BHCD

Bureau of Housing and Community Development, City of Portland

BID

Business Improvement District

BIT

Bureau of Information Technology, City of Portland

Bldg

Building

BOP

Bureau of Planning, City of Portland

Bridge Loan

Loan funds available to fund project costs on an interim basis, until other debt and/or equity sources are available for the project. This is sometimes considered part of the construction loan, but most specifically refers to a period after completion of construction until permanent or take out financing is available.

BTPW

Bureau of Transportation, Parks and Water, City of Portland

Bus

Business

Business Technical Assistance

Services provided to individuals to help them start, stabilize and grow a business. Typically advising centers around business planning, financial planning, marketing, access to capital, legal and human resource issues.

C

c/w

Citywide

Cash Flow Payment

A payment required by the Prosper Portland from Project Sponsors of projects receiving direct financial assistance financing including Housing Development Subordinate Loans and Equity Gap Contributions. This payment is in addition or in lieu of regular loan payments required by the agency.

CDBG

Community Development Block Grant, Federal

CDC

Community Development Corporation

CDN

Community Development Network

CES

Central Eastside

Comm.

Community

Community development

A process wherein community members come together to take action and generate solutions (economic, place-based, social, environmental, and cultural) to common problems.

Community Livability Projects

Projects supported by Prosper Portland’s Community Livability Grant (CLG) program, which provides grants to community-based organizations for projects that foster vibrant and healthy neighborhoods and improve the prosperity of area residents and businesses.

Construction Loan

A short-term loan usually made to finance the actual construction or renovation of improvements on land. The funds are disbursed as needed or in accordance with a prearranged plan and the money is repaid on completion of a project usually from the proceeds of a permanent loan. Commitment (PDC Commitment): a statement in writing representing PDC's legal commitment to a borrower that it will loan a certain amount of funds at a particular rate of interest, contingent upon specific conditions being met by a borrower.

Legal document recorded against the completed property or project. (See also 'long-term affordability period').

DEQ

Department of Environmental Equality

Designated Affordable Units

Units that must be affordable to, and occupied by, households earning at or below an agreed upon income level, as determined by the PDC and the Project Sponsor. The number, type and targeted household incomes of the Designated Affordable Units are recorded in the PDC loan documents as conditions of the loan or other financing agreements. Generally, the PDC requires the following:

Designated Distressed Areas

A residential area of the city that the Planning Commission designates for special assistance programs (e.g. limited property tax exemption) by virtue of the deterioration or the housing stock.

Dev

Development

Developer

Is the central member of the development team who is responsible for coordinating all aspects of the transaction. The developer may assume other roles such as general contractor, property manager, and general partner of the partnership that owns the property. Both for-profit and not-for-profit organizations are developers of affordable housing; sometimes they form joint ventures.

Developer Fees

Developer fees include developer overhead, profit, and fees for services normally performed by the developer such as development consultant fees, and project management.

Development Budget

A development budget includes preliminary construction line item costs, site acquisition costs, off-site costs (if applicable), soft costs, and other detailed cost information pertinent to the project.

Development Consultant

An individual or group of individuals hired by developer(s) who generally is responsible for budget preparation, application preparation, compliance with funding requirements, and other technical details of the project. Development consultant fees are considered a part of developer fees.

Development Team

Group of individuals or firms who carry out a development project, usually including the developer, the architect and engineer, the contractor, legal counsel, accountant and the development (technical) consultant.

Disparities

Differences between population groups in the presence of any form of outcomes, including access to services. Disparities include both acceptable and unacceptable differences. (Adapted from Multnomah County Health Department, Health Equity
Initiative)

Dist

District

DOS

Development Opportunity Services

DT

Downtown

Dwelling Unit

A building, or a portion of a building, that has independent living facilities including provisions for sleeping, cooking and sanitation, and that is designed for residential occupancy.

E

EAH

Employee Assisted Housing

Economic development

Work to improve the standard of living and economic competitiveness; activities include business retention, expansion and recruitment, international trade, and entrepreneurship development.

Economic opportunities

The ability for people to create wealth through activities such as: accessing employment, building businesses, and purchasing property.

ED

Economic Development

EDA

Economic Development Administrator

EDI

Economic Development Initiative

Eligible Non-Profit Organization

Organizations must be one of the following:

A 501(c)(3), 501(c)(4), or 501(c)(6) corporation,

A certified Housing Authority, or

A Limited Partnership or Limited Liability Corporation which includes one or more organizations which qualify under definition 1 above, and meet both of the following:

the 501 (c)(3) or (c)(4) organization or a certified Housing Authority has regular, continuous and substantial activity in the development and operation of the portion of the project seeking financing available only to non-profit organizations, and

the public investment can be demonstrated to further one or more of the objectives of the tax exempt non-profit entity.

Emp

Employee

EPA

Environmental Protection Agency

Equity

The "after value," or if not documented, the "as is" value of the property less all indebtedness secured by the property.

ESA

Endangered Species Act

ESC

Executive Steering Committee

Excess Cash Flow

The amount, if any, by which Net Cash Flow exceeds 115% of Permitted Loan Payments or $600 per unit, whichever is greater.

Extremely Low Income Households

Means household income at or below 30% MFI.

F

Fac

Facility

Family

For the purposes of this RFP, a family will be considered as one or more persons, whether or not related, living together in a dwelling unit.

Family Housing

Housing unit(s) two bedrooms or larger.

FAP

Financial Assistance Program

FAR

Floor Area Ratio

Fin

Finance/Financial

First-Time Homebuyer

An individual who has not held ownership interest in real property in the three years prior to application for PDC funds.

Floor Area Ratio (FAR)

A measure of development intensity. FAR is the ratio of the amount of floor area of a building to the amount of area of its site.

For For-Sale properties

the PDC restricts the maximum allowable sales price and requires that the units be sold to households that meet the targeted income criteria."

For rental properties

the PDC restricts the maximum allowable rents that may be charged and tenants to whom units may be rented for an agreed upon length of time.

Funded Affordable Unit

A unit, which serves households and has its rents set at a level which make it available to tenants with less than 80% of MFI, and require PDC gap funding to make the unit economically feasible as defined by PDC underwriting criteria.

G

Gen

General

Gentrification

The process by which an undervalued neighborhood becomes desirable, which results in the displacement of lower income households due to the loss of affordable housing, often with a corresponding change in racial and ethnic makeup of a neighborhood’s residents and businesses.

GIS (Graphic Information Systems)

GIS technology is used to develop maps that depict resources or features such as soil types, population densities, land uses, transportation corridors, waterways, etc. GIS computer programs link features commonly seen on maps (such as roads, town boundaries, water bodies) with related information not usually presented on maps, such as type of road surface, population, type of agriculture, type of vegetation, or water quality information. A GIS is a unique information system in which individual observations can be spatially referenced to each other.

Green Building or Green Design

Building design that yields environmental benefits, such as savings in energy, building materials, and water consumption, or reduced waste generation.

Greenway

A linear open space; a corridor composed of natural vegetation. Greenways can be used to create connected networks of open space that include traditional parks and natural areas.

Gross Revenues

All cash and cash equivalents (i.e., any item immediately convertible to cash without substantial discount or reduction) received by the Project Sponsor that is specified as gross revenue on the Pro Forma attached as Exhibit C of a PDC loan agreement, but not including proceeds from refinancing, loans, capital contributions, tenant security deposits that the Project Sponsor is obligated to return, and any rentals paid more than one month in advance during a Fiscal Year.

GW

Gateway

H

HAMFI

Household Adjusted Median Family Income

HAP

Housing Authority of Portland

Hard Costs

Include but not limited to all costs incurred in bringing a building to completion not including land acquisition, finance or sales costs.

HCDC

Housing and Community Development Commission

HDF

Housing Development Finance

HEG

Housing Evaluation Group

HIF

Housing Investment Fund

HIS

Housing Implementation Strategy

Historic Area

An area or building in which historic events occurred, or one which has special value due to architectural or cultural features relating to the heritage of the community. Elements in historic areas have significance that necessitates preservation or conservation.

HOAC

Home Ownership Advisory Committee

HOME

Funding source HUD for housing a federal Housing Program

Household Adjusted Median Family Income (HAMFI)

See Median Family Income

Household Income

The gross household income computed in conformity with HUD income limits.

Hsg

Housing

HSP

Hoyt Street Properties

HUD

Housing and Urban Development, US Department of

I

IGA

Inter-Governmental Agreement

Imprv

Improvement(s)

Income

Means gross household income computed in conformity with HUD income limits.

Income Level Category

The PDC utilizes the following categories of Median Family Income, as adjusted for household size, (HAMFI) to allocate resources for the development of housing that serves targeted populations in the City of Portland:

Extremely Low Income: Households with incomes from 0 to 30% HAMFI.

Very Low Income: Households with incomes from 31 to 50% HAMFI.

Low Income Households: Households with incomes from 51 to 60% HAMFI.
(This term is also used generically to refer to all households at or below 60% HAMFI.)

Water and sewer lines, roads, urban transit lines, schools and other public facilities needed to support developed areas.

Innovative

Please see the appendix of this document for a detailed definition of "innovative".

Internal Rate of Return (IRR)

The discount rate at which the present value of a project's cash flow income stream to the Project Sponsor equals the present value of the Project Sponsor's investment.

IRR

Internal Rate of Return

L

LEAD

Lead Abatement

Lease-up Reserves

An amount, either paid-in capital or funded through a loan, which anticipates an initial occupancy vacancy or short term lease-up shortfall. This amount is legitimate in projects undergoing substantial rehabilitation or new construction, and only when construction rather than operations create vacancy.

LEED

Leadership in Energy and Environmental Design

LEM

Location Efficient Mortgage

LID

Local Improvement District

LIHTC

Low-Income Housing Tax Credits, Federal

Loan to Value (LTV)

The total amount of all loans secured by subject property divided by the "after value" of the property expressed as a percentage. Grants requiring repayment only in the event of grant non-compliance, even if filed as a lien against the property, will not be considered loans for LTV calculation.

Long-Term Affordability Period

A period agreed to by funders and sponsors to ensure income and rent limits agreed to as condition of public funding through a recorded deed restriction on the project on a specified number of units in a project (See definition of funded affordable unit). Low-Income: means household income at or below 60 percent of MFI.

LTA

Limited Tax Abatement

LTV

Loan to Value

M

Market Rate Housing

Housing for which rents are not suppressed or restricted to below rents of the surrounding community generally considered to be 80 percent MFI or above although 'market' varies by neighborhood and location.

Median Family Income (MFI)

An income threshold set by Department of Housing and Urban Development, updated annually, generally in December. New thresholds are effective immediately. Current MFI thresholds can be found online at https://www.portlandoregon.gov/phb/

MFH

Multi-Family Housing

MFI

Median Family Income

Minimum Investment Requirement

The minimum financial contribution a Project Sponsor must provide as a source of development financing to receive PDC direct financial assistance funds. (See section 3.4.F.)

Mixed Income Housing

A housing development open to persons or families at varying income levels. More specifically at both affordable (below 60% MFI) and market rate income levels (above 60% MFI).

Mixed Use Development

Mixed use developments include residential, commercial, and business accommodations in one area.

Mixed Use Housing

A development that includes housing and commercial space or property containing both residential and non-residential uses.

Mixed-Income Project

A housing development open to persons or families at varying income levels. More specifically, the PDC uses the term Mixed-Income Housing to mean:

Rental housing projects that include both Designated Affordable Units affordable to households at or below 60% MFI and units affordable to households above 60% MFI, or

The combination on a site of residential uses with commercial or industrial uses. (This is different from the definition of Innovative, see appendix for a complete "innovative" definition.)

MOU

Memorandum of Understanding

MPDU

Moderately Priced Dwelling Units

MWESB

Minority-owned/Women-owned/Emerging Small Business

N

Neighborhood Prosperity Initiaitve (NPI)

A Prosper Portland program focused on community economic development at the neighborhood scale. A community-driven, self-help approach is at the heart of this work. With grants, training, and support from Prosper Portland, each district is responsible for planning and implementing projects to improve the local commercial district.

Net Cash Flow

The amount, if any, by which Net Operating Income exceeds the sum of Permitted Loan Payments and Required Reserve Contributions.

Net Operating Income

Net revenues received from operation of the subject property, less total operating expenses.

New Construction/New Housing Development

Newly built project.

NHP

Neighborhood Housing Program

NMTC

New Market Tax Credit

NNL

No Net Loss

NOFA

Notice of Funding Availability

O

OAHTC

Oregon Affordable Housing Tax Credits

OHCS

Oregon Housing and Community Services

OMF

Office of Management and Finance, City of Portland

Operating Budget (also Pro Forma)

Pro forma, is a schedule that include a rent schedule, anticipated operating expenses, vacancy rates, and all other information pertinent to the operation of the property. Operating income and expenses are generally projected for at least ten years.

Operating Deficit Reserves

Set-asides necessary to cover anticipated and unanticipated shortfalls in cash flow due to decreases in income or increases in expenses or debt service. Operating deficit reserves are different from lease-up reserves.

Operating Expenses

All reasonable and customary expenses incurred in operating the subject real estate, including (but not limited to) utilities, on-site and off-site management, insurance, property taxes, maintenance, replacement reserves, and administrative charges which are associated with any compliance monitoring or reporting required by funding sources. Operating Expenses do not include contributions to operating reserves, depreciation, interest or principal payments.

P

PDC Published Averages

Periodically, the PDC publishes its average funding amount per unit, per square foot, and per person served for new construction projects. These averages are broken down into Income Categories. Projects will be evaluated against these averages in the PDC approval process.

A long term loan, usually with a term between 10 and 40 years, the proceeds of which are used to repay a construction loan.

Permitted Loan Payments

The sum of the maximum debt service (including without limitation principal, interest, mortgage insurance premiums and credit enhancement fees such as letter of credit fees and/or other payment requirements) under any loans of the Project Sponsor relating to the project during the fiscal year. Permitted Loan Payments shall not include prepayments of principal not shown on the Pro Forma attached not consented to by the PDC in writing. Permitted Loan Payments shall not include any payments that are paid to an affiliate of the Project Sponsor.

PFF

Portland Family of Funds

PLOC

Preservation Line of Credit for Housing

Predevelopment funds

Funding to cover up front project costs such as architectural, engineering, legal and environmental services that are incurred before the funds to pay for project construction are available to the developer.

Preservation Properties

Federally subsidized property now at risk of opting out or prepayment, which would result in the loss of affordability commitments and project based Section 8 subsidies. Pro forma Income and Expense: a statement showing the projected annual income and operating expenses of a project.

Pro forma

Pro forma, is a schedule that includes a rent schedule, anticipated operating expenses, vacancy rates, and all other information pertinent to the operation of the property. Operating income and expenses are generally projected for at least ten years.

Project Sponsor

The project owner or entity entering into agreements with the PDC to obtain financing. Used in lieu of the term borrower, particularly for types of financing that are not loans (e.g. Equity Gap Contributions, fee waivers or tax exemptions).

Q

Qualified Non-Profit Organization

A 501(c)(3) or 501(c)(4) corporation that demonstrates the capacity and experience to develop and/or manage rental housing. Newly formed non-profit organizations must show evidence of mission, board training and commitment, individual staff training, adequate financial strength and experience and capacity, which are commensurate to the proposed project.

R

Recourse Debt

Debt repayment is based primarily on the property, but in the event of default to the extent the property cannot pay-off debt, the borrower is personally responsible for debt repayment.

Rehabilitation

Repair, upgrade of units within existing structure.

Rent-up Reserve

See lease-up reserves

Replacement Reserves

An account maintained by the borrower, funding of which is treated as an operating expense and used for repair or replacement of a project's infrastructure, i.e. roof, plumbing, mechanical, etc. For new construction PDC requires replacement reserves of $200 per unit per year.

Reservation of Funds

An informal set-aside of PDC direct financial assistance funds for a specific project that is valid for a limited period of time and evidenced by a Reservation Letter issued by the PDC. This is not a legal obligation to lend.

Reserves

Money set aside to pay for future anticipated expenses.

Restricted Residential Unit

A housing unit in a PDC funded project that is restricted as to affordability and rent limitations for a specified period of time according to a written affordability agreement.

RFP

Request For Proposal

ROF

Reservation of Funds

S

SDC

System Development Charge

SEA

Efforts and Accomplishments Report

SG/C:

Smart Growth Fund (from the Enterprise Foundation)

Single-Family Housing

A detached housing structure that contains 1 dwelling unit.

Site Control

Required for this RFP in the form of title, an option to purchase, a master lease agreement exceeding 99 years or other form of site control acceptable to PDC.

Soft Costs

See Indirect Costs.

Sources and Uses

A schedule submitted as part of financing application that identifies the different sources of funding for the construction of the project and provides a line item identification of how these funds will be used in the construction process.

Special Needs Housing

Housing unit(s) that are available to a specific population, such as elderly, disabled, homeless, or person in recovery.

Sponsor

See Developer.

Sustainable Development

Development with the goal of preserving environmental quality, natural resources and livability for present and future generations. Sustainable initiatives work to ensure efficient use of resources.

T

Tax Increment Financing (TIF)

A program designed to leverage private investment for economic development projects in a manner that enhances the benefits accrued to the public interest.

Term of Affordability

A specific period of time during which project rents are restricted for a specified number of units and during which the borrower agrees to provide annual operating data to verify compliance.

Threshold Criteria

Minimum requirement proposals must meet to be considered by selection committee for funding.

Housing development that addresses Region 2040 goals of increased density and improved utilization of public transportation systems. See definition of Innovative Projects and details of project requirements outlined in the Transit Oriented Tax Exemption guidelines.

U

Unit (of housing)

A housing unit consists of one or more habitable rooms intended to be occupied by one family for living, sleeping, cooking, and eating; except in congregate housing, where certain facilities may be shared.

URA

Urban Renewal Area

Urban Renewal Area (URA)

A defined geography from which tax increment financing is both generated and spent.

V

Variance

The relaxation of requirements of a zoning district for a specific parcel or tract of land. Variances are often issued to avoid unnecessary hardships to a landowner.

Very Low Income

Means household income at or below 50 percent of MFI.

W

Wealth creation

Increasing individual net worth which is defined as the value of all assets owned net of all liabilities owed at a point in time.

White people or communities

People or communities with the racial identity of Caucasian, without being Latino (per Coalitions of Communities of Color).

Workforce development

A range of educational, training, and networking activities to create, sustain, and retain a viable workforce that supports economic security for individuals and meets current and future business and industry needs.

Workforce housing

Workforce housing can be rental and ownership market housing units that are affordable to households with incomes from Moderately Priced Dwelling Units (MPDU) income limit up to Area Median Income (AMI).

Z

Zoning

Local regulations (i.e. City of Portland Bureau of Planning for this RFP) establishing the use of property and the size, height, and location of structures placed on it.